UK jobless rate now heading to a 40-year low

The jobs miracle continues – two million new jobs have now been created since David Cameron took over. The Tories are rightly boasting about all of this today, even if they’re keeping quiet about the fact that half of those new jobs have gone to foreign-born workers. Over the last five years, Cameron has overseen more job creation than any other peacetime Prime Minister, as the above chart shows. And he did this in a bust, not a boom. He cut taxes for employers, and for employees. He reformed welfare. Result: the greatest job-creation boom in UK history. Employers are so keen to hire that there are now more job vacancies than ever before: And there’s never been a greater share of the adult population in work. Here’s Citi:-

With strong labour demand (plus base effects from weak pay a year ago), pay growth is picking up a bit, with the growth of average earnings ex bonuses up to 2.2% YoY in February – highest since 2011 – from 1.6% YoY in January. The YoY growth of private sector earnings ex bonuses (2.7%) is the highest since 2009. Nevertheless, pay growth remains low given the decline in the jobless rate, hence suggesting that the equilibrium jobless rate has fallen from the pre-crisis norms of around 5%. We expect that the jobless rate will fall below 5% by yearend and – barring major shocks – the jobless rate probably will fall to a 40-year low – below 41 or 42% – in the next year or two/

You read that right, folks, the lowest jobless levels since the 1970s. And still the Prime Minister whose policies have brought this is neck-and-neck with one of the least popular Opposition leaders in recent history.